Order Date – 05 May 2025

Parties: M/s Great Eastern Hire Purchase Pvt. Ltd. Vs The State of Bihar through The Principal Secretary, State Tax, Bihar, Patna having its office at Kar Bhawan, Patna, The Principal Secretary cum Commissioner, Department of State Taxes, Government of Bihar, Patna, Joint Commissioner of State Tax, Gandhi Maidan Circle, Patna, Deputy Commissioner of State Tax, Gandhi Maidan Circle, Patna, Assistant Commissioner of State Tax, Gandhi Maidan Circle, Patna, Additional Commissioner of State Tax (Appeals), Patna West Division, Patna, The Union of India, through the Under Secretary, Department of Revenue, Govt. of India, New Delhi, The Government of India, Ministry of Finance (Department of Revenue), through the Principal Commissioner, CBIC, New Delhi.

Facts –

• The Petitioner, M/s Great Eastern Hire Purchase Pvt. Ltd., filed GSTR-3B and paid tax for July 2019 within 30 days of a best judgment assessment, making the order void under Section 62(2) of the CGST Act.
• Despite this, ₹1.12 crore was recovered in 2023 without notice. 
• The appeal against this was wrongly dismissed as time-barred.

Issue –

• Whether recovery could be lawfully made despite the deemed withdrawal of assessment under Section 62(2)?

Order –

• The Hon’ble High Court observed that grave injustice has been caused to the petitioner in this case by a completely unlawful recovery of demand dated 12.09.2019. It is an admitted position that the petitioner had already filed its return in Form GSTR 3B and paid due tax on it on 19.09.2019 which was well within the statutory period from the date of the impugned assessment order i.e.12.09.2019.
• On a bare reading of sub-section (2) of Section 62, there is no iota of doubt that the assessment order issued under sub-section (1) of Section 62 shall be taken to have been withdrawn by a legal fiction. Once, the assessment order lost it’s existence and efficacy in the eye of law, there was no reason for the Department to go for recovery of demand dated 12.09.2019.
• Department has misused its power and thereby passed an illegal order for recovery of the amount. The concerned authority did not think it just and proper to even issue a notice to the petitioner prior to passing an order of recovery which she was passing after about five years from the date of demand.